Whilst, for many pensioners, it is good news that the winter fuel allowance has been reinstated by the government for the coming winter, unfortunately action is needed if your income is over £35,000.
The payments will be £200 for households that include someone between state pension age and 79, and £300 for households that include someone aged 80 or over.
However, where a person’s income is above £35,000, then the allowance will be repayable to HMRC in full. This recovery will be done automatically by HMRC either via the pay as you earn code, which effectively means collection monthly by a reduction in your pension income, or if you are within self-assessment it will be included in your tax return.
HMRC have provided an online tool (https://www.tax.service.gov.uk/guidance/check-if-hmrc-will-take-back-your-winter-payment/session-restart) which will enable you to calculate your income to know whether your income is above the £35,000 limit.
If you think your income is above the limit such that you will have to repay the allowance then you can opt out using the online opt out form (https://submit.forms.service.gov.uk/form/7964/opt-out-of-winter-fuel-payment). You can also call HMRC on 0800 731 0160 or write to them at Winter Fuel Payment Centre, Mail Handling Site A, Wolverhampton, WV98 1LR.
It is important to note that if you need to opt out that this has to be done before 15 September 2025.
Whilst the reinstatement of the winter fuel allowance is good news for the many that really need it, how many people will realise that they have to opt out or repay the amount if their income is too high?